Moratorium on alienation of property for overdue foreign currency loans is extended
Law of Ukraine №895- ІХ of September 16, 2020 introduced amendments to the final and transitional provisions of the Code of Ukraine on bankruptcy procedures that are important for debtors — individuals who have received consumer loans in foreign currency, which (amendments) delay the termination of the Law of Ukraine “On the moratorium on the collection of property from citizens of Ukraine provided as security for loans in foreign currency” by 21.04.2021.
At the same time, the legislator has provided guarantees for the impossibility of deprivation of housing for those borrowers or property guarantors who, although they are not registered in mortgage housing, actually live in it, in case these persons do not own other real estate. Such a preventive measure exists when the terms of the loan agreement prohibit the registration of the place of residence of the borrower or property guarantor at the address where this immovable residential property is located.
The concept of “moratorium” in civil law is defined as a deferral of the fulfilment of an obligation (clause 2, part 1, article 263 of the Civil Code of Ukraine). Therefore, one should remember that creditors still do not lose the right to foreclose on the mortgaged property (pledge) in the event of failure to perform a treaty obligation by debtor, but only temporarily will not be able to exercise their right for enforceable collection (alienation without the consent of the owner) of this subject of mortgage (pledge).
Enforcement documents on foreclosure on the subject of a mortgage (pledge) in 04/21/2021 will also be a subject to return if:
- immovable residential property is used as the place of permanent residence of the borrower or property guarantor;
- this housing is an object of construction in progress and is in a mortgage;
- the borrower or property guarantor has no other housing;
- the total area of housing (construction in progress) does not exceed 140 m2 for an apartment and 250 m2 for a residential building.
In addition, enforcement of decisions, including the seizure of the property of the borrower or property guarantor, and other actions aimed at foreclose on the mortgaged property will also be outlawed before the specified date.
We hope that the legislator, within the extended 6-month period, will nevertheless adopt an appropriate special law that will balance the disputed legal relationship and protect the interests of not only debtors — individuals, but also banks.
Source:Moratorium on alienation of property for overdue foreign currency loans is extended (esquires.ua)
